Which SEPP method to use
L1: Which SEPP method to useHello guys. I am 53 yrs old and have lost my job recently. I am wanting to start taking distibutions frommy IRA. I thought that using the RMD method that I could calculate the amounts I wanted each year but what I am reading on this web site it appears that I can’t. My tax adviser is not much help on this subject. My question is since I am going to have to use either the Fixed amortization or the Fixed annuitization method to get the amount of money I need each month, which method should I use ? Can you tell me the pro’s and con’s of each ?
Thanks for your help.
DRS2009-07-12 21:23, By: DRS, IP: [220.127.116.11]
L2: Which SEPP method to useNo real difference.
The amortization method merely generates a few more dollars based on the same age, interest rate and initial balance.2009-07-12 21:57, By: Gfw, IP: [18.104.22.168]
L3: Which SEPP method to useThe RMD method would yield around 40% less than the other fixed dollar methods the first year, and would vary after that. It’s not that you cannot use RMD, rather it is to your advantage to use a fixed dollar method.
Under RMD you DO have to make a new calculation each year, but that is far different that calculating what you want or need. You would have to abide by the result whether it suited your needs or not. With one of the fixed dollar methods, your annual distribution would not change, UNLESS you then wanted to make a one time switch to RMD because that would be to your advantage at the time. Starting with a fixed dollar method leaves that option open for you if you need it.2009-07-12 23:47, By: Alan S., IP: [22.214.171.124]
L4: Which SEPP method to useThanks guys for your help. You gave me the info I needed.2009-07-13 11:51, By: DRS, IP: [126.96.36.199]